# CLP Strategy & Configuration Log

This document detailed information about clp position (6153292) + auto hedge on Hyperliquide.

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## 1. Low Volatility / Weekend Optimization (Narrow Range)
**Date:** 2025-12-29
**Status:** Active
**Objective:** Further optimalization of hedging on Hyperliquide.

### 🔍 Context
*   **Market Condition:** Monday, th 29th of Dec
*   **Capital:** $1,000 USDC
*   **Range:** +/- 1.5% (Narrow)

### ⚙️ Configuration of scripts 
(See original file for full config dump)

### test results
1. clp position:
  {
    "type": "AUTOMATIC",
    "token_id": 6153292,
    "status": "CLOSED",
    "target_value": 993.31,
    "entry_price": 869.418,
    "amount0_initial": 500.0094,
    "amount1_initial": 0.5674,
    "liquidity": "2284728345715808667084",
    "range_upper": 882.4136,
    "range_lower": 856.6782,
    "token0_decimals": 18,
    "token1_decimals": 18,
    "timestamp_open": 1766982584,
    "target_value_end": 982.48,
    "timestamp_close": 1767000734
  }
2. hedge transactions (from Hyperliquide)
(See original file for table)

## results of tests are not satisfactional:
1. the main problem is that the hedge doesn't cover lost value of clp pool (without earned fees) -> **-$2.23** 

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### 🚀 Analysis & Diagnosis (2025-12-29)

After reviewing the logs and transaction history, here is the breakdown of the PnL and the root cause of the slippage.

#### **1. PnL Breakdown (The "Missing" $2.23)**

*   **LP Position Value Change:**
    *   Initial Value: ~$993.31
    *   Final Value: ~$982.50
    *   **LP Loss:** **-$10.81** (This is the Impermanent Loss + Delta Loss from holding BNB as it dropped).
*   **Hedge Compensation:**
    *   Hedge Gross Profit: **+$10.61** (from your table).
    *   **Net Delta Efficiency:** The hedge covered the LP loss almost perfectly (Diff: -$0.20).
    *   *Conclusion:* The **Delta Calculation is CORRECT**. The math effectively neutralized the market move.
*   **The Costs (The Real Leak):**
    *   **Trading Fees:** You paid ~$0.79 in fees on Hyperliquid (mostly from the initial Taker entry and the final Taker exit).
    *   **Funding Fees:** Since you were Shorting BNB for ~5 hours, and rates might have been negative (Shorts pay Longs) or just the cost of carry, the remaining discrepancy (~$1.20) is likely **Funding Costs** or slight slippage between LP exit price and Hedge exit price.

**Total Net:** -$0.20 (Delta Slippage) - $0.79 (Fees) - $1.24 (Funding/Execution Slippage) = **-$2.23**

#### **2. Execution Inefficiency (The "Panic Loop")**

The logs reveal a flaw in the execution strategy during trending moves:
1.  **Drift:** Price drops, Delta drift exceeds threshold (`0.05`).
2.  **Maker Attempt:** Bot places an `ALO` (Maker) order at the Bid.
3.  **Timeout:** Market moves down faster than the order fills. The order sits pending (`[WAIT]`).
4.  **Cancel:** Bot cancels the stale order.
5.  **Drift Worsens:** The drift continues to grow as price drops further.
6.  **Panic:** Eventually, `Drift > 5x Threshold` (Large Hedge).
7.  **Taker Smash:** Bot forces an `IOC` (Taker) trade, paying high fees (0.035%) and eating slippage.

**Evidence:**
*   Initial Entry: `[WARN] LARGE HEDGE` -> Taker (Fee: $0.21).
*   Final Exit: `[URGENT] ... Force Taker Exit` -> Taker (Fee: $0.45).
*   These two trades alone account for ~85% of your fee costs.

---

### 🛠️ Answers to Questions

**1. Is the calculation of hedge wrong?**
**No.** The Delta calculation is accurate. The gross profit of the hedge (+$10.61) almost exactly matched the raw value loss of the LP (-$10.81). The math works.

**2. How we can proactively fix it?**
We need to fix the **Execution Strategy** to avoid the "Wait -> Cancel -> Panic Taker" loop.
*   **Soft Taker Fallback:** If a Maker order times out (e.g., after 30s), retry as Taker immediately *before* the drift becomes huge.
*   **Asymmetric Compensation:** Increase the "Over-Hedge" factor. Since V3 LP accumulates "Long" exposure as price drops (Negative Gamma), we should short *more* aggressively early on.

**3. What we can do with configuration?**
We need to tune for **Narrow Ranges** (High Gamma).

#### **Recommended Config Changes**

| Parameter | Current | Recommended | Reason |
| :--- | :--- | :--- | :--- |
| `MIN_HEDGE_THRESHOLD` | `0.05` | **0.02** | Hedge smaller deviations sooner to prevent runaway gamma. |
| `LARGE_HEDGE_MULTIPLIER` | `5.0` | **2.5** | Trigger Taker/Urgent correction sooner, before the hole gets too deep. |
| `MAKER_ORDER_TIMEOUT` | `600` | **60** | Don't let orders rot for 10 minutes. Cancel and retry faster. |
| `SHADOW_ORDER_TIMEOUT` | `600` | **30** | Same as above. |
| `BASE_REBALANCE_THRESHOLD_PCT` | `0.25` | **0.15** | Tighten the percentage-based trigger. |

#### **Code Change Recommendation (Unified Hedger)**
We should update `unified_hedger.py` to:
1.  **Persist Realized PnL:** Fix the bug where `_status.json` isn't updated with hedge PnL, so your logs reflect reality.
2.  **Execution Fallback:** If an `ALO` order fails/cancels, decrement a counter. If it fails twice, force `IOC`.

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### 📝 Action Plan
1.  Apply the **Config Changes** above to `clp_config.py`.
2.  (Optional) I can patch `unified_hedger.py` to fix the PnL logging and execution logic if you approve.